By Sara Ingell,
University of Saskatchewan Student
There is an ongoing debate in the agriculture industry between small family farms and large corporate farms. The controversy between these two different farming operations both have their advantages and disadvantages in regards to their farming practices. Small family farms can not compete with large corporate farms as small farms do not have the same assets to offer. These assets include manpower and money, with a larger farm comes more workers and more money. What will happen to small family farms if large corporate farms continue to buy land is not only a concern all over North America but could also be a concern close to your hometown as well.
Advantage And Disadvantages Of Large Corporate Farm
When people think of large corporate farms, they think of large companies that influence or own lots of land to practice large scale agriculture. Corporate farming describes an agriculture operation that involves the production of food and food-related products on a large scale (Source). Over the years agriculture has been dependent on many things including the weather, market demands and prices, and new technology but a new challenge that farmers have to deal with is the corporate farms. With more corporate farms, small family farms are pressured to expand their farm if they are able. They can either buy more land or step out of the way of the large farms and sell their own family farm. If small family farms are able to buy more land, this may mean that they have to purchase their neighbour’s farmland and putting another small family farm out of business. (Source).
Even though large corporation farms buy enormous amounts of land, they do give many job opportunities as they need lots of manpower to operate their large scale farm. Van Raay Land Inc. has farmland and feedlots throughout Alberta and Saskatchewan and they hire lots of Mexican Mennonites, about 20% of the farms 50 employees are Mexican. Hiring these people gives them a new opportunity to have a good job and start a new life to support themselves and their families. (Source). Also, by buying land from other farmers, they are helping those small family farms pay back some of their debt. Large corporations care a lot about being environmentally and ethically smart unlike some people think. Van Raay Land Inc. is a part of the Environment Farm Plan (EFP) to help identify their environmental risks, use technology to eliminate overwatering, using cattle manure to fertilize, and reduce fuel emissions by having their feedlots and farmland close together (Source).
Large Corporation Farm Affects In Prairie Hometowns
Being from a farming background in Outlook, Saskatchewan, I have seen firsthand large corporations coming into our farming community and buying land. The large corporation that affected my farming community is Van Raay Land Inc., they purchased a total of about 10,500 acres at a total price of $9.5 million. Van Raay Land Inc. purchased land around the Outlook farming community at a rate of $900 to $1000 an acre. This corporation started in Alberta and slowly moved into Saskatchewan. (Source). Many farmers in this area were bought out by Van Raay Land Inc. and were unable to compete with the large corporation. These farmers are not able to compete as they do not have the same manpower or money to compete with Van Raay Land Inc. This is just an example of small family farms going out of business because of large corporate farms buying land around them.
Advantage And Disadvantage Of Small Family Farms
When people think about a small family farm, they think about a farm that is owned and ran by family members and has been passed down through generations. Many small family farms have their children helping out on the farm by operating machinery and working long hours, farmers feel like they can do what they want with their farm without worrying about work standards. Some farmers strongly refuse to expand if it means going outside of their family because once you are outside of your family, you’re subject to paperwork and liability that is linked to the government (Source). An advantage of a small family farm is that everyone has the same understanding when a task needs to be done. In case of any future issues such as death, divorce, or someone leaving the farm for another reason, the family can enter a unanimous shareholders agreement that lays out terms of payout and amounts. Lastly, the family can tie their assets together so it is more difficult to divide and the farm stays in their legacy (Source).
One main disadvantage of small family farms is that farms can be broken through feuds between siblings and relatives. These feuds put a risk of destroying a farming operation especially if inheritance and estate are involved (Source). In small family farm operations everyone is tied to make important decisions together and everyone might not have the same perspective, some family members wish to retire and want to be protected for retirement but the children may want to continue to farm. In conclusion, expenses that are considered to be personal can lead to issues, such as one family member using more fuel than someone else (Source).
Policy To Support Small Farms
After looking at the advantages and disadvantages of both large corporate farms and small family farms it is clear that small family farms need to be supported. A way to support family farms is to work towards allowing the transfer of assets from generation to generation to be tax-free. This will allow an advantage over corporate farms because the family farm will stay in the family allowing to make easier connections with the consumer on a family basis than a large corporation. Small family farms take family seriously as it’s evolved around family members working together on the farm that has been passed down through generations. Large corporate farms come into the farming community and buy farmland out from small family farms, small farms aren’t able to compete with these corporate farms as they don’t have as much to offer making these small operations go out of business.
- Soergel, Andrew. “Family Farms Pushed to Get Big or Go Bust.” U.S. & World Report News, 4 April 2018, https://www.usnews.com/news/best-states/articles/2018-04-04/family-farms-pushed-to-get-big-or-go-bust
- Pratt, Sean. “When your neighbour is a mega-farm.” Glacier farm media. The Western Producer, 19 October 2012, https://www.producer.com/2012/10/when-your-neighbour-is-a-mega-farm/
- “How We Do Farming.” VRP Farms. https://www.easybib.com/guides/citation-guides/mla-format/how-to-cite-a-website-mla/
- Hursh, Kevin. “Van Raay buys Saskatchewan farmland.” Decisive Farming. 22 March 2010. https://decisivefarming.com/van-raay-buys-saskatchewan-farmland/
- Miller, Colin. “Weighing pros and cons of single family farm corporation.” Glacier farm media. The Western Producer, 24 October 2019, https://www.producer.com/2019/10/weighing-pros-and-cons-of-single-family-farm-corporation/
- Manjusha. “What is corporate farming?” Quora. 24 June 2016. https://www.quora.com/What-is-corporate-farming
Hi, my name is Sara Ingell and I grew up on a grain farm outside of Outlook, Saskatchewan. Currently, I am in my third year of an Agronomy degree with a minor in Agribusiness at the University of Saskatchewan. Growing up around the agriculture industry I have developed a love for agriculture and a passion for sharing it with the community. After graduating, I look forward to continuing my education as I enter the work force in the agriculture industry.
Interesting and thought provoking article. My main response is to re-visit the definition of small vs large and family vs corporate. If I have 500 acres and you have 1,000, you are the large farmer in the area, even though both may be small for an area. We are all large corporate farmers relative to a place like China where average farm is well under 5 acres in size. There will be always someone larger and someone smaller, with more or less family involved with pros/cons at every size so as an industry we need to spend more time looking inward to what makes our farm unique and improve what we can control.
Justin, this is a great point. In efforts, Sara was restricted to a set number of words, in which we cut or directed her to skip over the comparison between scale domestically vs internationally or across various types of production or crops. But you do make a valid point, and we would be happy to invite you to write a blog on this further for us. Plus as an alumnus of the U of S, it’s always great to get feedback on student blogs for our current students!